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KATE BOLDUAN, CNN ANCHOR: Good morning and welcome to NEW DAY. It's Thursday, July 3rd, 6:00 in the east. Chris is off today. We're going to begin with, you saw right there, we have to begin with breaking news.

Arthur, look at the track right now. It is now the first hurricane of the season heading for North Carolina's outer banks bringing 75-mile- an-hour winds with it. People on Hatteras Island are being told they must evacuate, and since it's such a popular vacation spot, especially heading into the 4th of July holiday, local officials there are not taking any chances.

They are ordering people to leave during daylight hours before conditions deteriorate. We're tracking this hurricane's every move for you. Let's start with meteorologist, Indra Petersons at Kill Devil Hills on the outer banks -- Indra.

INDRA PETERSONS, AMS METEOROLOGIST: Good morning, yes. Right now we do know Arthur has strengthened to a Category 1 hurricane, steady winds at 75 miles per hour, moving to the north at 9 miles per hour. Where is it right now? It's about 113 miles off the coast of Charleston, South Carolina. You can actually see the outer bands already starting to make their way to shore so they are starting to see that rain.

Let's talk about what is expected to happen. Arthur is expected to strengthen to likely 85 miles per hour. Today passing by South Carolina. Then there is the potential here on the outer banks, right where I'm standing, that we could see the greatest impact tonight into the early hours of tomorrow morning as a Category 1 hurricane with 85- mile-per-hour winds.

Then it's still expected to curve off to the north, start to make its way south as it makes its way offshore, south major cities like New York and D.C. It could intersect again. If you look at far western track, we could see another intersection around Cape Cod by Friday evening, 4th of July during the evening hours.

And then it continuous to make its way north possibly intersect again as low around Halifax on Saturday. Taking a look here behind me, you can actually see. Remember, still very far south. Beautiful this morning. Seeing almost flat conditions, a couple of clouds in the sky, but we know it's not going to stay this way for long. (BEGIN VIDEOTAPE)

PETERSONS (voice-over): In North Carolina's outer banks, cars lined up to top off at the pump.

WOODY EDWARDS, NC RESIDENT: This storm is taking a trajectory that we're just kind of worried about.

PETERSONS: Mandatory evacuations beginning early this morning as Arthur strengthens becoming a hurricane, threatening the holiday weekend for parts of the east coast.

UNIDENTIFIED MALE: Move, get out, but even if you don't move, then stay away from the water as much as possible.

PETERSONS: Twenty five counties now under a state of emergency. Massive wind gusts turning water so dangerous two ship captains were ordered to dock and abandon their charter boats along the shore.

UNIDENTIFIED MALE: Get a big storm surge that can easily bust through any part of these outer banks, you know, without much of a problem.

PETERSONS: And Arthur won't stop there, heading up the east coast. The storm is looming over some of the biggest Independence Day fireworks display. Ocean City Maryland postponing their 4th of July fireworks while Bostonians will enjoy their festivities a day early.

COLONEL TIMOTHY ALBEN, MASSACHUSETT STATE POLICE: It's not optimal. We wish it were, but we've got to deal with this.

PETERSONS: And in D.C. the electric company says it's closely monitoring Arthur which could produce strong damaging wind gusts, large hail and frequent lightning, possibly delaying the iconic National Mall fireworks to Saturday. But on Wednesday the sun was still shining I North Carolina and the beaches were full of vacationers who say their patriotic partying on the shore will go on.

UNIDENTIFIED MALE: We'll ride it out and see what happens.

(END VIDEOTAPE)

PETERSONS: Looks like hurricane warnings are already in effect from looks like surf city all the way down through dock. Hatteras Island had mandatory evacuations starting at 5:00 this morning. What is expected? Some heavy rainfall? We are going to see 3 to 5 inches of rain in the South Carolina area and North Carolina, could see about 2 to 4 inches.

Remember, we could have the potential here for a direct impact so we'll have to include storm surge. Add about another 2 to 3 feet of water in addition to that heavy rainfall. Also it's likely to make name pact right during high tide so that's going to be a big concern on people's minds as well.

A lot to think about, and especially when Irene happened here just in 2011. Highway 12 broke in two places, fresh on everyone's mind is whether or not we're going have the potential, again, to see that break again. Back to you guys.

MICHAELA PEREIRA, CNN ANCHOR: All right, Indra, thanks so much and let's hope that people heed those warnings. As you said, the last hurricane very much in people's minds. Much of North Carolina's coast, as you saw there, is under a hurricane warning now bracing for Arthur's imminent arrival.

I want to head to Ahead now to Wrightsville Beach, 230 miles south of where Indra was located and that's where we find our Alina Machado. Alina, you know, they are talking storm surges, rip currents. It could potentially be a real mess there.

ALINA MACHADO, CNN CORRESPONDENT: Yes, Michaela, it really could. This is the calm before the storm, but conditions here will get worse, as the day progresses. We're expecting high winds and lots of rain and very rough surf, and the big concern in this area today is really those rip currents.

We did talk to the mayor. He said there will be extra people here all day making sure if anybody gets caught in a rip current that they take them out. Bottom line, nobody should really in this water while the conditions are expected the way they are going to get here -- Kate.

BOLDUAN: All right, Alina, thank you very much. Watching on that front for us. If you're traveling for the 4th, you probably won't be immune to Arthur's ripple effect. The storm is expected to cause flight delays and cancellations, and, of course, when it starts one place it happens really across the country. Couple that with another powerful storm system that's coming in from the west, and you have a recipe for travel nightmares.

All of this after a wild night of violent storms slamming the northeast. Just check out these spectacular lightning in New York City. Beautiful from a very far distance, we can say. Jason Carroll is looking at all the travel headaches that could be ahead. He's at New York's LaGuardia Airport. Jason, how is it looking from inside at the moment?

JASON CARROLL, CNN CORRESPONDNET: Well, first, I heard you talking about that lightning, yes, from really far away it looks good, but definitely not up close. Out here, things are looking actually not too bad. Look at the flight board over there. Most of the flights seem to be leaving on time, a few residual delays and cancellations out here. Not too bad today. Yesterday, that was a much different story.

(BEGIN VIDEOTAPE)

CARROLL (voice-over): A spectacular show from Mother Nature, lightning hitting the Empire State Building and New York City high rises. Drenching rain from severe storms pummeled New York State, causing flash flooding inland and washing away roads. Heavy wind brought a tree crashing down on the roof of this home. Severe weather causing temporary delays and cancellations at all three of New York City's airports Wednesday afternoon.

UNIDENTIFIED MALE: I'm much happier to be traveling today as opposed to tomorrow. Tomorrow is going to be insane.

CARROLL: It's the same storm system that wreaked havoc across the Midwest, grounding planes and knocking out power lines. In Chicago on Tuesday traffic into and out of O'Hare International Airport brought to a near standstill, actually not standing, some passengers got out and walked to the airport to make their flights.

UNIDENTIFIED MALE: I've been walk begun 20 minutes.

CARROLL: AAA predicts it will be one of the busiest travel weekend in the past seven year, all this as Hurricane Arthur continues to push up the east coast. Heavy rain expected to remain mostly offshore, encouraging news to motorists, AAA expects 41 million to drive 50 miles or more this weekend, up nearly 2 percent, the last 4th of July and almost 14 percent more than this year's Memorial Day weekend.

UNIDENTIFIED MALE: Probably 80 percent of those traveling out on the road, pack your patience.

CAROLL: It's not just roads that will be packed. An estimated 8 percent of Americans will travel by rail and bus this holiday weekend.

(END VIDEOTAPE)

CARROLL: So, again, for most travelers, at least passengers here at LaGuardia airport, checked some of the other airports as well, Newark and JFK as well. Most of the flights seem to be leaving on time. Got an e-mail from our Don Lemon who said he's trying to get to Chicago. He's stuck, can't get out, but he's in the minority on this one. Most of the people seem to be getting to where they need to go on time today -- Kate, Michaela.

PEREIRA: I'm sure Don will find some things to do there. This is the thing. People do need to be aware things could change today as this storm moves north. Jason, thanks so much for that report. Adding to the weather woes, security is getting beefed up on some flights that are headed for the United States.

The Department of Homeland Security is asking airports in Europe and the Middle East to tighten safety measures in response to concerns that terrorists are developing explosives that could escape airport detection. We'll bring in our Pamela Brown live in Washington with more. What can we expect?

PAMELA BROWN, CNN CORRESPONDENT: Here's what we've learned. DHS is working with specific airports overseas to step up security measures in response to new intelligence like terror groups like al Qaeda in the Arabian Peninsula, trying to build new kind of bombs to get past screening procedures, bombs with less explosive residue and metallic component.

Passengers overseas mostly coming from Europe and the Middle East could notice the changes over the next several days. This is happening very soon, and according to one DHS official we spoke with, there will be additional inspection of shoes and electronics, additional explosive trace detection machines. And in some cases another set of screenings at boarding gates as well as more random checks of passengers, among other security measures, and important to note though that this will not impact any domestic flights and it has nothing to do with the 4th of July weekend, according to officials we've been speaking with -- Michaela and Kate.

PEREIRA: Pamela, when you travel overseas often times each country has different procedures for their screening. How is the TSA going to manage implementing those measures overseas because you are dealing with different nations?

BROWN: That's right. TSA doesn't screen at foreign airports, but what TSA can do is say you cannot fly into the U.S. unless you put these new security measures into place. So we've learned that TSA is working with these specific airports overseas, with the carriers and with the foreign governments to make sure that these new security measures are in place.

And if they are not in place, and we know that TSA has personnel over there monitoring these changes going into effect, if they are not in place, then, again, they can say you can't fly no the U.S. then.

PEREIRA: Again, coming into the United States you won't see these changes being affected if you're flying domestically.

BROWN: Correct.

PEREIRA: Pamela Brown, thanks so much for that.

BOLDUAN: So more undocumented immigrants could be arriving in the Southern California town of Marietta tomorrow, and some people there fear it could get uglier than what we saw earlier this week. Dozens of angry protesters shouting go home, among other chants.

Met three buses of undocumented immigrants from Central America transferred from honestly overwhelmed border facilities in Texas. The buses couldn't get by and ended up having to go to another town. Last night the protests continued at a heated town hall. Kyung Lah has more.

(BEGIN VIDEOTAPE)

KYUNG LAH, CNN CORRESPONDENT (voice-over): Even before the Marietta town hall began, debate exploded in the waiting crowd.

LAH: Inside the packed auditorium, cheers drowned out any opposition to the city's stand against the federal government's busing in undocumented immigrants. On Tuesday a wall of protesters blocked the entrance to the Marietta border patrol station. Three buses carried 140 undocumented immigrants from Central America. Many of them women and children. They are part of an influx of migrants cramming facilities in Texas, many of them unaccompanied children.

A total of 60,000 to 80,000 children without parents are expected to cross illegally this year. The federal government coping by shipping them to smaller towns like Marietta, but Marietta's protesters -- forced these buses to turn around. This town hall underscored Marietta still does not want them.

UNIDENTIFIED FEMALE: This is an invasion. Why is the National Guard not out there stopping them from coming in?

MAYOR ALAN LONG, MARIETTA, CALIFORNIA: This is admittedly a nationwide problem and little old Marietta has taken the lead in getting change.

LAH: In a week that's shown the uglier side of the immigration debate.

UNIDENTIFIED MALE: Am I being detained? Am I being detained?

LAH: The small town braces for the next wave of buses, the next which could happen as soon as the 4th of July. Kyung Law, CNN, Marietta, California

(END VIDEOTAPE)

BOLDUAN: Let's get over to Christine Romans now for some other top stories.

PEREIRA: It's the ladies shift.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Celebrating the nation and the founding fathers with women.

A Colorado woman accused of trying to help is fighters, wage Jihad in Iraq and Syria. Court documents reveal 19-year-old Shannon Maureen Conley was arrested at the Denver airport back in Denver. She was attempting to meet someone she met on the internet, marry him and join with the terrorist group.

She remains in federal custody. Prosecutors will lay out their case today against Justin Ross Harris, the father charged with murder after his toddler died in a hot car. Police say both Harris and his wife, Leanne searched the internet for leaving kids in hot cars.

Police have questioned and found a person of interest on the weekend shooting on Bourbon Street. Justin Odom has been arrested on unrelated charges. Authorities are looking for another person in that case. Ten people shot in a busy part of the French quarter early Sunday morning one of them died Wednesday.

And from one secretary of defense to another. Chuck Hagel putting in a call to goal keeper, Tim Howard thanking him for defending the United States at the World Cup. Hagel told him with a little training he could become the real secretary of defense. Hagel was referring to a White House Wikipedia update that has the superstar goalie listed as America's secretary of defense for at least a hot minute.

BOLDUAN: He was. We are able to get a screen grab of it. Thank goodness.

PEREIRA: Who has more tattoos?

BOLDUAN: I'm sure that would be Tim Howard.

(CROSSTALK)

PEREIRA: What's lingering under the blazer.

ROMANS: He's not done. He says he's going to come home, he's going to relax, he's going to hang with his family and get more tattoos and be himself. Love it.

BOLDUAN: That's always part of the calculation. Talk to the kids, get some tattoos and figure out what's next.

PEREIRA: Chill out.

BOLDUAN: Very kind of Secretary Hagel to do that, wasn't it?

Coming up next on NEW DAY, Christine knows better than anybody, we're going to be talking about the jobs numbers in just a little bit, but we're also going to be talking about this. A new cycle of violence between Israelis and Palestinians fueled by the kidnappings and deaths of three Israeli teens and the possible revenge killing of a Palestinian boy. What can be done to stop it?

PEREIRA: And some really frightening moments aboard a Qantas airplane. Water started pouring down the aisle, forced that plane to turn around. We'll give you some details behind a growing number of disturbing incidents in the skies.

(COMMERCIAL BREAK)

BOLDUAN: Overnight, the Israeli military carried out airstrikes against Gaza in response to rockets fired into Israel. The tension escalating in the region after clashes broke out following the deaths of a Palestinian teenager in East Jerusalem. Police are investigating the death. Palestinians say though the boy was murdered in retaliation for the killings of three Israeli teens in the West Bank.

Let's bring in Diana Buttu. She's a former legal adviser to Palestinian President Mahmoud Abbas and former legal adviser and spokeswoman for the PLO, the Palestine Liberation Organization.

Diana, great to see you. Thanks for coming in.

DIANA BUTTU, FORMER PLO SPOKESWOMAN: Thank you. Thank you, Kate.

BOLDUAN: Of course.

I mean, violence, you know this better than anybody. Violence between Israelis and Palestinians, this unfortunately is not new, but you do wonder when you see those pictures of those boys' faces, those four young boys, when and why did it get to a point that killing innocent teenagers was part of this?

BUTTU: The big problem, Kate, is nobody is really looking at the root causes of the violence, and this isn't violence for the sake of violence. Unfortunately, it comes within a political context which is 47 years of the denial of freedom of Palestinians.

When it came to this latest attack on this young boy whose body was torched, it was not only fact of the denial of freedom but the fact that the Israeli government went out of its way to incite Israelis to violence. It was everything from the Israeli prime minister calling for revenge, to Israeli ministers also calling for blood, and so it's unsurprising --

BOLDUAN: But at the same time, Diana, they were all calling --

(CROSSTALK)

BUTTU: Fifteen-year-old kidnapped and then killed.

BOLDUAN: Everyone from both angles was calling for no one to take the law into their own hands. The prime minister has called for calm, Secretary of State John Kerry has called for calm. Everyone is -- they have condemned this violence on these teenagers.

There's no excuse for the killing of teenagers in response to violence that's been going on for 40 years.

BUTTU: Absolutely, and this is why in terms of how this scenario has played out, you can't on the one hand call for revenge and then on the other hand say that you don't condone violence. The big problem is that when it came to these -- these three Israelis that there -- there were calls by Palestinians for an investigation to actually look into what was happening. Palestinians were also investigating themselves independent of the Israelis what had happened to these three Israelis, and yet what the Israeli response was to simply impose collective punishment on Palestinians, whether it was through the bombing of the Gaza Strip, raiding of Palestinian areas and killing 11 Palestinians.

So, the problem is that unless we get to the root causes of it, which is the denial of freedom, then we're going to continue to see this spiral out of control.

BOLDUAN: Yes, but Israel -- I had the Israeli ambassador to the United States on just a couple days ago. Those attacks, those airstrikes on Gaza you're talking about, those were in response to rockets coming from Gaza into Israel. I mean, this goes back and forth, back and forth over and over again.

I don't want -- I don't think anyone wants to hear more political speak. I think we just need to have a conversation about at this moment do you believe that the Palestinian Authority are investigating the death of the three Israeli boys? Do you believe that Hamas is behind it?

BUTTU: Well, Kate, I know for a fact that the Palestinians have been investigating this for quite some time, since the initial allegations came out. The big problem is that when it comes to the Israelis, all that they have done throughout this collective punishment. And while you talk about air strikes on Gaza, this is not something that is new. This isn't coming in response to rockets. The siege has been on Gaza for several years now, including bombs that are being dropped on Gaza.

But going back to what's happened in the West Bank and specifically with respect to these individuals, the Palestinian president came out very quickly and said that he condemned it. He called for an investigation, and instead of the Israelis going into an investigation they simply carried out measures of collective punishment.

For example, one of the suspects in the kidnap and then murder, his house was blown up by the Israeli authorities. This is without charge, without trial and without a conviction. So, these are the types of measures that are going to lead to more and more violence. And unless we address the denial of freedom and the basic human rights that entitled to, unfortunately, this is going to continue to spiral out of control.

BOLDUAN: I know that you believe that the death of the Palestinian teenager in East Jerusalem was a revenge killing. Do you also then believe just assuredly --

BUTTU: Yes.

BOLDUAN: -- that Hamas is behind the killings of the three Israeli teenagers in the West Bank?

BUTTU: It's -- Kate, we simply don't know at this point. All we've heard is allegations but there has been any evidence or any proof that has been backup to substantiate those allegations. This is why we've been calling for an investigation and while an investigation is ongoing, the idea of collective punishment is not something that we should be condoning or applauding.

BOLDUAN: Diana, how bad is this going to get, because at the moment it doesn't seem like anyone is heeding the calls of calm coming from -- coming from senior leadership in Israel and in the West Bank.

Do you believe that this is only going to get worse? Are we looking at the beginnings of a recipe of another intifada? How bad is this going to get? Is this the spark that's going to light something horrible?

BUTTU: Well, it just may be. One of the big problems is that we've been witnessing a period of violence against Palestinians for quite some time. Even during the period of negotiations where Secretary Kerry was involved. Israeli forces killed over 56 Palestinians and demolished over 126 homes. So, the recipe for disaster is there. All that it takes is a little

bit of a spark, and I'm afraid that what we saw yesterday may just be that spark.

The real question is who is out there now to protect Palestinians from this ongoing destruction, the ongoing harm, and unless we have some clear international intervention to make sure that Palestinians are protected, then I think that we're going to continue to see this spiral out of control?

BOLDUAN: So, you do not accept as enough what you're hearing coming from President Obama and Secretary of State John Kerry so far?

BUTTU: No. While the statements are very good and very positive that they are calling for restraint, it's not just a question of restraint and calm, but it's a question of getting to the underlying causes, and as I've mentioned, that you can't have an army running rampant in the West Bank, carrying out measures of collective punishment and then simply expect that there's going to be a period of calm.

I think that what needs to be done is that there needs to be restraint placed on the Israeli government to make sure that they are not allowed to continue this type of violence, to make sure that they are settlers, 90 percent of the violence that comes from the settlers is never prosecuted, to make sure that they are reined in as well and to make sure people on the ground, civilians are actually being protected rather than harmed.

BOLDUAN: Violence on the part of both sides has been part of the ongoing and failed peace talks for years. That's one thing that is for sure.

Diana Buttu, thank you very much for your time.

Of course. Michaela?

PEREIRA: All right. Let's take a short break on NEW DAY. Next up though, it is now a Hurricane Arthur is gaining strength as it moves north. Has its eye on the North Carolina coast. We're live on the ground.